Monthly Archives: October 2013

Why McDonald’s Killed the Dollar Menu—in 1 Chart

"The sad news that McDonald's is ending its Dollar Menu after eleven years reflects a simple truth: You can't make any money selling burgers for $1, any more. The fact that the Dollar Menu has lasted this long might make you think fast-food prices have lagged behind other items, in real terms. But the price of beef and other staples has been turbulent. With some help from the inflation pros at BLS, I graphed this chart of 'fast food' inflation (technically 'limited service meals and snacks') versus all food for home consumption and core inflation minus housing, which is different from the more commonly used core inflation, but subtracts housing's recent boom." Continue reading →

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Spain’s jobless now relying on pensioners to survive

"After a career spent repairing trains, Francisco Marcos Gallego once thought he and his wife would end their days in comfort. Instead they are struggling to support their unemployed son and his children. The couple must use their combined monthly pension of 1,300 euros ($1,760) to help feed their son Miguel, 49, who has been out of full time work since 2009, and the teenaged children who still live with him. Still suffering the effects of the economic slump triggered by the collapse of a property boom in 2008, more and more Spanish families are relying on their retired parents to survive as their unemployment checks run out and mortgage bills pile up." Continue reading →

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Plans for Political Union Unravel in Europe

"Advocates of tighter integration believe that the euro zone needs to go further by borrowing elements from the American system of federalism. Many proposals reflect a belief that the euro zone needs to partially mimic the U.S., where the dollar works well across all states partly because of budgets, bonds, financial oversight and depositor protection at the national level. Over the past year, however, the political winds have shifted. Interviews with more than a dozen officials across Europe reveal how plans for deeper integration have run aground as financial markets have calmed and mistrust has simmered between power centers including Berlin, Brussels and Paris." Continue reading →

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Get rid of corrupt politicians , and here’s what you get, a Happy Country!!!

Denmark Is Considered The Happiest Country. You’ll Never Guess Why. Posted: 10/22/2013 8:06 am EDT | Updated: 10/23/2013 8:51 am EDT . Follow: The Third Metric, Danish Lifestyle, Denmark, Denmark Gender, Denmark Happy, Denmark Health Care, Gross National Happiness, Happiest Countries, National Happiness, Screen Sense, Healthy Living News . Last month, Denmark was crowned the […]

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Marc Faber: Bond Burglars to Bring Bears Out of Hibernation

"The probability that we have embarked on permanent asset purchases by the Fed is very high (until QE99 — or at least until the system breaks down, as just outlined). To Mr. Bernanke’s credit, and to be fair to him, I need to point out that his economic sophism is shared by most central bankers around the world. We can see that the global monetary base has exploded more than fourfold since 2003. These universally common monetary policies are, of course, applauded by fund managers, bankers and the investment community, all of which benefit (including myself) from rising asset prices." Continue reading →

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Alan Greenspan Sees ‘Double Digit’ Inflation Ahead

"Alan Greenspan, the former Federal Reserve chairman, has largely avoided public comment on the Fed’s efforts to stimulate the economy, but he has said enough to make it clear that he is not a fan. It’s been a long time since anyone accurately predicted higher inflation. Instead, inflation has sagged to the lowest levels on record. But here’s why Mr. Greenspan is worried. Each time the Fed buys a bond, it pays the bank that sells the bond by creating money and putting it into an account that the bank keeps at the Fed. Mr. Greenspan’s inflation prediction is based on his estimation of the consequences as that money flows out into the economy." Continue reading →

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Foreign investors: Why US bank may close your account

"El Paso’s international trade traffic in 2011 was greater than the trade traffic passing through San Diego, Calif. and Nogales, Ariz. combined. With such cross-border economic activity it is only natural for foreign businesses to maintain U.S. bank accounts in El Paso. Unfortunately, many of these commercial accounts are being closed by U.S. banks. Why is this happening? The answer can be traced back to the bank formerly known as the Hong Kong Shanghai Banking Corporation and its violations of the 2001 Patriot Act – transgressions that a U.S. Senate subcommittee investigated and resulted in the assessment of a $1.9-billion penalty to HSBC in July." Continue reading →

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Faber: Fed could up QE to $1 trillion a month

"Marc Faber, publisher of The Gloom, Boom & Doom Report, told CNBC on Monday that investors are asking the wrong question about when the Federal Reserve will taper its massive bond-buying program. They should be asking when the central bank will be increasing it, he argued. 'The question is not tapering. The question is at what point will they increase the asset purchases to say $150 [billion], $200 [billion], a trillion dollars a month,' Faber said in a 'Squawk Box' interview. Faber has been predicting so-called 'QE infinity' because 'every government program that is introduced under urgency and as a temporary measure is always permanent.'" Continue reading →

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Federal Reserve Policy Failures Are Mounting

"One possible reason why the Fed have consistently erred on the high side in their growth forecasts is that they assume higher stock prices will lead to higher spending via the so-called wealth effect. The Fed's ad hoc analysis on this subject has been wrong and is in conflict with econometric studies. The studies suggest that when wealth rises or falls, consumer spending does not generally respond, or if it does respond, it does so feebly. During the run-up of stock and home prices over the past three years, the year-over-year growth in consumer spending has actually slowed sharply from over 5% in early 2011 to just 2.9% in the four quarters ending Q2." Continue reading →

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